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Revenue drops become clearer |
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Friday, November 07 2008 |
By TJ HEMLINGER
Staff Writer
Whitley County stands to lose as much as $15,000 in state tax money in 2009 and another $80,000 the following year now that the General Assembly has enacted property tax caps, according to a consulting firm that does work for the county.
The county council met Wednesday morning to listen to an update.
“It’s one of the most sweeping (acts of) legislation on the funding of government,” Todd Samuelson told the council. “All units in Whitley County will experience a revenue loss.”
That includes Columbia City, South Whitley, Churubusco and Larwill, as well as the townships, libraries and school corporations.
“The highest revenue loss will be in the incorporated areas,” Samuelson said.
Columbia City will lose about 3 percent of its property tax money, while South Whitley will lose around 8 percent.
The Whitko Community School Corp. will be shorted around $134,000; Smith-Green will get about $10,000 less in 2010; and Whitley County Consolidated School Corp. will get $101,000 less.
Samuelson said that if a taxing unit has a capital project, such as a new high school, it will need to reduce the budget elsewhere.
The action of the General Assembly, known as House Bill 1001, gives the county council a non-binding review of other budgets.
“The result (of H.B. 1001) will be a shift in who pays property taxes to non-homestead properties,” Samuelson said. “The tax burden will be shifted away from homesteads.”
The bill increased the homestead exemption for property owners. It also changed the arrangement so that the state will take over welfare that used to be the county’s responsibility, as well as schools’ general funds and police and fire pensions. The state sales tax also went up from 6 percent to 7 percent, and property tax replacement credits will stop.
“Your tax bills may not go down that much because of the property tax replacement credit elimination,” Samuelson told the council.
One possible source of revenue for counties will be the local option income tax.
“It will give some flexibility at the local level to give alternatives to funding government,” he said. “It will use income tax instead of property tax to fund government.”
The maximum income tax levy would be 2.25 percent.
“It’s changing how government is funded,” Samuelson said.
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Last Updated ( Tuesday, November 11 2008 )
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